Clive Palmer has declared the Abbott government's Direct Action policy is "dead", saying his Palmer United Party will use its numbers in the Senate to block the Coalition's policy to replace the carbon tax.

Mr Palmer said on Monday the controversial policy, which aims to reduce emissions largely through payments to businesses, was “hopeless” and would be "gone" if his party, Labor and the Greens all vote against it, as they have previously indicated.

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Mr Palmer had said earlier in the day he would not support Direct Action if the Abbott government made any changes to the pension, in light of growing speculation that there are plans to raise the pension age to 70 and tighten eligibility requirements.

But on Monday afternoon Mr Palmer went a step further and said there would not be any circumstance in which his party would vote for Direct Action.

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The government plans to spend up to $1.55 billion over the next three years on the scheme, but several senior economists have questioned whether Direct Action can meet its emissions reduction target of 5 per cent by 2020 with that budget.

Mr Palmer said the policy did not make economic sense and questioned whether it would have any environmental effect.

“We can’t see any reason to vote for Direct Action,” Mr Palmer said.

“We think it’s hopeless.”

Mr Palmer, whose party will have three senators from July 1, said it did not mean the PUP would not support the repeal of the carbon tax and that the party was still considering its response to the repeal bills, which have already been voted down once in the Senate.

He said he did not have an alternative to replace Direct Action and he had based his position on his view that the policy would achieve little for the economy.

“I don’t think we need an environmental initiative to replace Direct Action – if something has no environmental effect it’s pointless to say that it does.”

He added: “We just don’t think direct action is any good.”

“The Greens are not going to support Direct Action.

“Labor isn’t.

“And we’re not.

“It’s gone, it’s dead.”

The government is due to publish its white paper with details of how Direct Action will work this month.

Mr Palmer said the details on the policy had been so scarce that Australians did not know what Direct Action was “other than a lot of money”.

“The Treasurer says we’ve got to save a lot of money so we’re following his lead,” he said.

“If they don’t know what the policy is two months out from the budget you have to assume it’s not a good one.”

Environment Minister Greg Hunt said on Monday the government remained confident it would be able to repeal the carbon tax and introduce Direct Action.

"We have been given a clear mandate by the Australian people and remain committed to repealing the carbon tax and introducing our Emissions Reduction Fund and we are confident we'll achieve both," Mr Hunt said.

"I look forward to considering any concerns raised and working with all elected members of Parliament to ensure repeal of the carbon tax and implementation of the Emissions Reduction Fund.

"The government is committed to taking strong and effective action to deal with climate change by reducing emissions by 5 per cent below 2000 levels by 2020."

Acting Greens leader Adam Bandt said the alternative plan on which Tony Abbott had staked the repeal of the carbon tax was “in tatters”.

He said that without the numbers in the Senate to pass direct action, Australia could be left with a situation where it had no climate change legislation at all.

“If Tony Abbott teams up with Clive Palmer to tear down existing climate laws in the full knowledge that he can’t get his alternative scheme through the Parliament, the Prime Minister will have failed to protect our country’s way of life and will be Australia’s biggest ever vandal.

“He will have ripped down a scheme that’s working knowing he doesn’t have the numbers in Parliament to put an alternative in place.”

Mr Bandt also called on the incoming PUP senators to block moves to repeal the carbon tax.